The Federal reserve has cut the launch timetable for its new real-time payment system FedNow by a full year to 2023.
The announcement narrows a delivery timeframe on a previous notice in 2019 that indicated industry-wide availability in 2024.
“Over the last several months, we’ve made significant strides toward our programme milestones for the FedNow Service,” says Esther George, president and CEO of the Federal Reserve Bank of Kansas City and executive sponsor of the FedNow programme. “Based on the FedNow team’s progress, we are pleased to share this updated timeline so the industry can continue to prepare for the adoption of FedNow.”
The launch of the new payments plumbing will operate in a phased approach, beginning with core clearing and settlement functionality and key value-added features, such as a request-for-payment capability and tools to support participants in their handling of payment inquiries, reconcilements and certain exceptions.
General availability will occur after extensive testing by the more than 110 participants who have signed up for a pilot programme to ensure the service is market-ready.
“We are working hard to respond to the industry’s call for urgency and growing demand for the service, which is evident in the widespread response to our call for pilot participants,” says Kenneth Montgomery, Federal Reserve Bank of Boston first vice president and chief operating officer and FedNow program executive. “As part of our commitment to transparency, we will continue to provide updates and further narrow our launch window as we achieve additional programme milestones.”